Tidjane Thiam plots his comeback with $1.5bn deal

Tidjane Thiam proudly posted a picture of himself smiling with Credit Suisse’s executive team to his thousands of Instagram followers just days before stepping down as chief executive.

It was February 2020 and the high-flying investment banker was resigning in an attempt to control a spying scandal engulfing the bank: Credit Suisse had admitted it hired detectives to spy on former staff. Despite saying he had no knowledge of the espionage, Thiam left his job to protect the bank’s reputation. 

Now Thiam is reinventing himself as a dealmaker and making his way back to the front line of global finance. 

The banker, who has also worked for Aviva and Prudential, was approached as a potential successor to Jean Pierre Mustier’s role as boss of Italian lender Unicredit, according to reports last year, but opted to instead focus on investments in emerging markets.

Sources close to Thiam, 59, say he was more interested in taking on a variety of projects – he also takes an interest in healthcare and combating climate change – than a job at one of the world’s largest banks.

Now, he is now on the cusp of launching his first deal since moving on from Credit Suisse. 

The Telegraph understands the former chief executive is likely to launch a merger with his blank-cheque company, Freedom Acquisitions I, within weeks. Sources say Thiam is in the process of tapping investors for a final round of funding before a formal announcement. 

In March last year, the blank-cheque company – also known as a special purpose acquisition company, or Spac – listed on the New York Stock Exchange in a deal that raised $345m (£252m).

Backing came from fund manager Pimco as well as the billionaire Pinault family, the French tycoons behind Gucci owner Kering Group. Thiam’s fundraising target before launching is reportedly $1.5bn.

It comes as part of a surge in Spac deals that have taken over markets in the US, in which empty vehicles float on the stock market and use raised money to buy up existing businesses wanting to go public.

Thiam’s vehicle is expected to formally declare its acquisition target in the coming weeks, following reports that he had zeroed in on a company last summer.

Sources said the banker might have been lured into the US Spac frenzy after seeing rivals from Swiss investment banks making waves in the space. 

Brady Dougan, the American chief of Credit Suisse between 2007 and 2015, also launched a Spac last year, while UBS Group’s former Swiss boss Sergio Ermotti joined the race in 2020. Ermotti chaired the blank-cheque company that recently helped Italian fashion house Zegna list in New York. 

A source says: “It was the obvious thing for Thiam to do. It’s quite a quick way to get back on the horse. You had Brady Dougan and others doing it as well – and they’re all quite competitive.”

The former Credit Suisse chief reportedly entered the Spac arena after JP Morgan pitched him the idea, with its chief executive Jamie Dimon – the longest-serving Wall Street CEO – personally involved in the early stage talks. Freedom Acquisition I is now advised by the investment bank, as well as Bank of America and Broadhaven Capital Partners.

According to Michael Wisson, a director in PwC’s Capital Markets team, top bankers view Spacs as a chance to get involved in more entrepreneurial projects associated with disruption and fresh opportunities. In return, the companies get years worth of expertise.

“They feel they have the vision and the contacts to make these deals work,” he says.

“Industry leaders bring their experience to bear in these deals. It’s not a passive thing – they don’t just put their money in and hope the target delivers the money. The best ones involve a good marriage between the founder and the acquirer. They share the same strategic vision.”

Wisson adds that, in his experience talking to these bankers, the prospect of trying something new clearly excites them. 

“They’ve often been in large organisations before, and suddenly they are going into a real entrepreneurial environment. Lots of the companies involved are cutting-edge – they are looking at new trends.

“These people also have so much to give. They’ve had lots of experience and learning. They know how to commercialise an idea and bring it to market, and make it a success. Many people get to a stage in their career where that motivates them, and they would prefer to do that over sitting on another FTSE 100 board.”

When it comes to Thiam, it has been reported he is hoping to snap up Credijusto in his Spac deal and that the Mexican lender founded in 2015 could be merged with data provider CIAL Dun & Bradstreet. It might be a good fit, allowing Thiam to leverage his contacts in emerging markets and help the bank expand overseas.

Thiam, who is on the board of directors at Kering, was born in the Ivory Coast and, as an adult, returned to work in its government, as well as representing the African country at the World Bank and IMF.

Financiers behind Spacs – also known as sponsors – aim to rapidly ramp up growth in their target companies, but experts warned that acquisitions are only successful when dealmakers are realistic about valuations.

Carsten Berrar, a lawyer at Sullivan & Cromwell, says: “[The valuation of the target] is in the end the fundamental question for the success of the combined business.

“You need to avoid a situation where the combined company needs two or three years to grow into the valuation that was agreed at the time of the business combination.

Berrar adds: “This is also in the interest of the target shareholders. You could say they are only interested in maximising the value of the target at the time of the combination. But that’s not true: in almost all cases, the target shareholders will not cash out at the time of the business combination.”

Svetlana Marriott, a capital markets partner at KPMG UK, says the success of a deal would depend on the quality of the board running the blank-cheque vehicle.

“If the Spac is looking to invest in a particular sector, then clearly having a sector expert on the board would be important. The requirements are similar to those for any IPO. They need to have a good attitude to risk and investor protection. The board needs to have a clear strategic direction, and it needs to be balanced in terms of skills as well.”

Adam Gishen, who worked for Thiam at Credit Suisse, is spearheading efforts to finalise the deal as chief executive of Freedom Acquisition.

Speaking to Euromoney in March 2021, Gishen said the Spac’s investors had “deep pockets” and were looking to invest in a target company for the long term.

“At the heart of what we are doing is that we want to find a management team we can work with,” he said.

When it comes to Freedom Acquisition’s board, a combination of Thiam and Gishen would be well placed to spearhead a quality deal.

Gishen worked in capital markets in Lehman Brothers in the years leading up to the financial crisis, and went on to become a managing director at Nomura in London before joining independent advisory firm Ondra. He started at Credit Suisse in 2015, working in investor relations, corporate communications and marketing. 

The pair will be hoping they can deliver on what they promised investors – and make a success of Thiam’s comeback to global markets.

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